Correlation Between Merck and Gaslog Partners
Can any of the company-specific risk be diversified away by investing in both Merck and Gaslog Partners at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Merck and Gaslog Partners into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merck Company and Gaslog Partners LP, you can compare the effects of market volatilities on Merck and Gaslog Partners and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Merck with a short position of Gaslog Partners. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merck and Gaslog Partners.
Diversification Opportunities for Merck and Gaslog Partners
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Merck and Gaslog is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Merck Company and Gaslog Partners LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaslog Partners LP and Merck is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Merck Company are associated (or correlated) with Gaslog Partners. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaslog Partners LP has no effect on the direction of Merck i.e., Merck and Gaslog Partners go up and down completely randomly.
Pair Corralation between Merck and Gaslog Partners
If you would invest 863.00 in Gaslog Partners LP on August 23, 2024 and sell it today you would earn a total of 0.00 from holding Gaslog Partners LP or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Merck Company vs. Gaslog Partners LP
Performance |
| Timeline |
| Merck Company |
| Gaslog Partners LP |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Merck and Gaslog Partners Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merck and Gaslog Partners
The main advantage of trading using opposite Merck and Gaslog Partners positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merck position performs unexpectedly, Gaslog Partners can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Gaslog Partners will offset losses from the drop in Gaslog Partners' long position.| Merck vs. Johnson Johnson | Merck vs. Small Cap Core | Merck vs. Freedom Holding Corp | Merck vs. Gfl Environmental Holdings |
| Gaslog Partners vs. Brooge Holdings | Gaslog Partners vs. Dynagas LNG Partners | Gaslog Partners vs. Dynagas LNG Partners | Gaslog Partners vs. Martin Midstream Partners |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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